Flexible workers are increasingly crucial to warehouse labor

 

Key takeaways

  • Warehouses are anticipating more normal business conditions in 2023.
  • They are more confident about attracting and retaining staff, and they are also using more flexible workers.
  • The performance of flexible workers has improved across a variety of metrics.

This week we've released our 2023 State of Warehouse Labor report, drawing on a survey of hundreds of businesses in logistics, distribution, storage, and fulfillment. After a year when consumers' demand for goods stalled and inventories stacked up on shelves, warehouses are looking forward to conditions closer to pre-pandemic norms. And flexible workers are a key part of their strategy.

More success with staffing

Staffing issues continued to plague warehouses in 2022, with 34% of our survey respondents saying they had to forgo revenue because of a shortfall in labor. But going into 2023, the managers surveyed for the report were more confident in their ability to attract and retain staff.

chart1

 

They used a variety of tactics to boost recruitment and retention, including pay raises, bonuses, benefits, and promotions. But even among their permanent employees, flexible schedules were in high demand. And a majority of respondents said that increasing flexibility was one of their most effective tactics for holding onto their workers:

chart2

 

In fact, flexibility has become almost as important as pay for retaining workers.

Flexible work to flex capacity

The use of flexible workers has also increased, with almost half of respondents saying they brought in flexible workers to deal with changes in demand throughout the year. Notably, many of these businesses used flexible workers to some degree throughout the year, not just for their peak seasons:

 

chart3

 

A quarter of respondents said they used flexible workers so they wouldn't have to commit to a full-time hire. For these businesses, flexible workers were part of a strategy to mitigate economic uncertainty.

A big reason why warehouses have been relying more on flexible workers is their improving performance. Respondents said they were having an easier time filling shifts and were more satisfied with flexible workers across a variety of metrics:

 

chart4

 

We think several factors could explain this greater satisfaction. As a larger share of the labor force engages in flexible work, the average quality of flexible workers is likely to rise. Businesses are also adapting their workplaces and division of labor to set flexible workers up for success. And finally, platforms like ours are supporting more efficient matching of flexible workers with businesses.

There's much more detail in the report, so please have a look and get in touch if you'd like to discuss the data.

 

Realtime metrics

These metrics, derived from data aggregated across the Instawork platform, compare the two weeks starting 3/30/2023 to the previous two weeks. To control for the overall growth of the Instawork marketplace, only shifts involving businesses that booked shifts in both periods are included:

  • $0.07 rise in hourly pay

  • 1.8% point drop in share of short-notice shifts

  • 1.4 hours drop in hours per existing worker

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